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DISSector- A B-Gyan Initiative
Business Interaction Committee, NITIE Page 1 https://www.facebook.com/bgyan.nitie
DISSector
Consulting in India
India is among the fastest-growing market for most global consulting firms. The Indian Consulting Industry
has been experiencing resurgence in the last few years. The industry has been making rapid strides in the
Indian market over the last decade and has witnessed a significant increase in the number of new entrants
in this field. The solitary objective of the participants in this market has been to gain maximum market
share within this highly consolidated and competitive environment, primarily by capitalizing on the
apposite factors driving it. Information Technology (IT) including e-commerce, telecommunications and so
on followed by Corporate Strategy, Outsourcing Services such as Payroll and Human Resource, Tax and
Audit and Operations Management have been some of the prominent business divisions in the consulting
market.
History of Consulting in India
It was in the 90s that McKinsey first brought the consulting strategy to India, setting up an office in Delhi.
The growth was initially quite slow and in a decade they were only able to bring in 100 odd consultants.
However, that escalated very quickly in the next decade and today, they have around 500 consultants
working for them in the country. Booz Allen Hamilton had also tried establishing his firm in India but gave
up in merely two years because the Indian market was quite difficult for the firm. However, Booz and Co.
came back to India recently and are now well established thanks to their new, well-planned strategies.
DISSector- A B-Gyan Initiative
Business Interaction Committee, NITIE Page 2 https://www.facebook.com/bgyan.nitie
Industry Overview
Consulting industry in India is expected to be a Rs 22,000 crores industry by 2020
(Source:Assocham)
It is expected to grow at a CAGR of 30%
There are approximately 10,000 consultancies in India.
The Indian-consulting advantage:
Low cost structure
Diverse capabilities
Academic competence
Industry currently employs workforce of over 3 lacs
Types of Consulting Firms
The classification can be done in two ways:
Classification 1:
Large Consulting Firms These Medium to Large sized management consultancies offer their services
across functions within a wide range of industries.
Boutique firms that have focused areas of consulting expertise in specific industries, functional areas,
technologies, or regions of the world
Classification 2:
Tier 1 They are mainly into Strategy consulting: Market
Entry, cost optimization, Growth strategy, Business
Consulting. This includes firms like McKinsey & Co, Bain &
Co., Booz & Co, BCG , AT Kearney etc.
Tier 2 Tier 2 firms are mainly Industry Focused.
Examples include KPMG, Deloitte, E&Y, PWC, Accenture
etc.
Tier 3 Their offerings include Advisory cum outsourcing services. The firms like Wipro, Infosys, TCS, Capegemini, Cognizant etc will fall into this category.
DISSector- A B-Gyan Initiative
Business Interaction Committee, NITIE Page 3 https://www.facebook.com/bgyan.nitie
Industry Practices
Management consulting firms offer their services across industries. Some of them are as follows.
Advanced Electronics Aerospace and Defence Automotive & Assembly BFSI
Chemicals Consumer Packaged Goods Electric Power & Natural
Gas
Healthcare Systems &
Services
High Tech Infrastructure Media & Entertainment Metals & Mining
Oil & Gas Pharmaceuticals & Medical
Products
Private Equity & Principal
Investors
Public Sector
Pulp & Paper/Forest Products Retail Semiconductors Telecommunications
Travel, Transport & Logistics ITeS
Functional Practices
Business Technology Corporate Finance Marketing & Sales Operations
Organization Risk Strategy Sustainability &
Resource Productivity
DISSector- A B-Gyan Initiative
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Top Five Consulting Firms Profiles
Market Scenario
Fastest-growing markets
Difficult economy
Tougher clients
Buying cycles are getting longer
Competition is tougher
Project mandates are forcing consultants to raise the game
Percentage split of the total APAC revenue across difference business units
How Consulting is changing in India!
McKinsey and Co, Noshir Kaka, MD
In July 2011, Gautam Adani decided to seek the help of consulting firms to engineer a complete transformation in his $7.7-billion group.
Booz got their corporate centre, Accenture bagged the infrastructure business, AT Kearney snagged the power part, while KPMG managed to get hold of the ports business.
Newer companies are buying consulting services; buying cycles are getting longer; consulting relationships are getting more promiscuous; competition is getting tougher, and the missing marquee names from the Adani consulting roster also indicate that clients now don't get taken in by the 'messenger' but go by the message.
DISSector- A B-Gyan Initiative
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On-the ground changes Streamlining distribution Better go-to-market strategies Operational excellence Efficient supply chain
management
Emerging Trends
The assertion that critical times lie ahead for the consulting industry may be sounding a bit repetitive now, but it remains true. Consulting firms in 2013 will no doubt be looking for the watering holes in a persistently tough market, but the smartest amongst them will recognise that the greatest potential doesnt lie in seeking out new markets, it lies in being ready to challenge the received wisdom about what consulting is and how its done. - Edward Haigh, Director of Source
BCG, Arindam Bhattacharya, MD
Twenty three years ago, CK Birla roped in McKinsey for a turnaround project for Hindustan Motors. That birthed the management consulting story in India.
Since then, true-blue strat firms (McKinsey, BCG, Bain, AT Kearney, Booz,) straddle the top end; consulting arms of technology firms like Accenture, IBM, occupy the mid-tier, the Big Four's consulting arms target the mid and bottom layer of the pyramid, a handful of boutiques (Universal Consulting, Avalon Consulting etc.) fill in the niches, and some credible newcomers like Oliver Wyman and Rolland Berger are fighting for their share.
Between 500 and 600 high-value consulting engagements (most expensive consulting that's largely the domain of the strat firms) are awarded each year. That's a $250-300 million market, including 30-40 projects that are worth about $2 million each.
AT Kearney, Saurine Doshi, MD
Between 2004-2010 (barring the 2008-09 blip), the management consulting market grew at 20%-plus. Indian subsidiaries of McKinsey, BCG, Bain and AT Kearney were among the top three firms in terms of growth in their universe globally.
Adds Saurine Doshi, MD, AT Kearney: "We have nearly tripled in size during the last four years." Under Ashish Singh's leadership, even late entrant Bain and Co has scaled up to 17 partners and 180 consultants in just seven years the fastest scale-up for any major consulting firm. Despite such growth, consulting penetration remains poor in India compared with the developed markets. "The consulting spend of just the Wall Street area is multiple times the spend of many regions, like India," says Manoj Singh, Global COO, Deloitte Touche Tohmatsu.
Over half of all assignments in the last 4-5 years have come from newer clients like family-owned mid-caps, private equity and private equity-owned companies, infrastructure projects, public sector (excluding banks), and state governments.
1990s
2000s2010s
Changing Clients Expectations
DISSector- A B-Gyan Initiative
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Affecting factors
The way forward!
German Market grew by just 7% in 2011 and was the second biggest in the region behind UK
Lot of dependence on performance of Financial Services IndustryLow Levels of growth in Europe
New Services
New Roles
New Delivery Models : move away from the old pyramid consulting model to something more flexible
Testing Strategies
Example: Deloittes acquisition of Monitor
Clients tend to get cynical about market consolidation since it removes capacity and choice from the market
Interests of consulting firms and clients should be balanced by the restructuring industry
Further Consolidation
The Gulf Cooperation Council (GCC) - strongest performing consulting market .
Saudi Arabia, represents 32 % of the GCC market, and Qatar, 13 % , will continue to fuel a booming market but India is expected to recover
Role of Brazil and China in Global Market
Hotspots
BCG is seen by clients to be increasingly capable of diversifying by role and delivery model.
the big question: whether one of either PwC or Deloitte can start challenging it for top spot
Best Placed for Growth
Nature of projects
move towards high-end strategy consulting
Public sector consulting projects
Ex: market demand assessment of the Rs. 78,000 crore Gujarat International Finance Tec-city (GIFT)
Industry structure
move towards greater market segmentation
International management and strategy consulting firms
ideal for high level strategy projects
Niche Management consulting firms
focus on particular sectors
Operational Consulting Firms
focus on operational efficiencies, emerging market segment
IT Consulting Firms
high end technology consulting
innovation and R&D
Paid management consulting services
move towards greater acceptance
Cultural perception
knowledge and advice linked with a persons age
DISSector- A B-Gyan Initiative
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One of the fastest-growing segments of consulting has been information technology (IT). This segment
includes consultants focused on e-commerce; telecommunications; intranet and Internet strategies and
functionality; hardware systems design and implementation; software design, acquisition and
implementation; and web site design and operation.
Corporations today, have new IT needs thanks to the rapidly expanding fields of social networking, mobile
computing, online employee collaboration and cloud computing and data storage.
IT consulting - Overview:
IT consulting firms have evolved into full service companies. In many cases, they are now integral departments within larger technology-based firms. The IBM Global Services unit of computer giant IBM best illustrates this trend
A large portion of income is derived from outsourcing. Once these firms have determined a clients needs during a consulting or analysis phase, they may deliver turnkey services that include actual day-to-day operation of the clients computer department and/or other departments.
Extremely rapid growth of large companies that are based in India but compete globally, such as
Wipro, Infosys and Tata Consultancy Services (TCS). These companies quickly grew multi-billion
dollar revenue bases as major contenders in the global IT sector. Additional hot competition comes
from software companies, such as Oracle, that have quickly built up large consulting units of their
own.
DISSector- A B-Gyan Initiative
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For the near-term, the biggest opportunities for IT consulting growth will lie in three exciting areas:
Big Data
Cloud-based IT infrastructure
Mobile apps and data services The role of a consultant in IT firms is comparable to that of a business analyst. The job description of a consultant in such firms is listed below:
1. Requirements gathering: Working with client to
decide scope of the project, map the business
requirements into things the developers can
understand, i.e making screen mock-ups, process flow
diagrams, mapping business fields into database fields
etc.
2. Industry Analysis: Studying latest trends in the industry, adding some gyaan from companys
Name Headquarters IT
Consultants
Genpact Gurgaon, India 49,000
HCL Technologies Noida, India 90,000
Infosys Bangalore, India 155,000
Larsen & Toubro Infotech Mumbai, India 16,000
Tech Mahindra Mumbai, India 84,000
MphasiS Bangalore, India 34,000
Oracle Financial Services
Software
Mumbai, India 10,000
Tata Consultancy Services Mumbai, India 276,000
Wipro Technologies Bangalore, India 145,000
WNS Global Services Mumbai, India 25,000
experience with clients. The result will be a marketing Leading IT Consulting Companies in India
ppt that can be used to start a conversation with prospective clients.
3. Pre-sales support: Taking responsibility for preparing documents in response to Request For Proposals
(RFPs) from clients. This will involve speaking to various people in the different horizontals of the company
(i.e if it is a Testing project, call up the Testing Head) to collect all the relevant materials demonstrating the
companys credentials for the project, and tailor them to the requirements of the client.